Saudi Arabia, BAE and the Serious Fraud Office: the cover-up

The government's decision to block the investigation into BAE System's massive arms contracts with Saudi Arabia is not just outrageous: it looks as if it may be in breach of an OECD Convention to which Britain is party, and the 'explanations' of it given by the prime minister, the attorney-general and the head of the Serious Fraud Office are riddled with contradictions and obfuscation. The Guardian of 16 December 2006 helpfully quotes the attorney-general, Lord Goldsmith, on the effect of the OECD Convention:

He specifically quoted article 5 of the OECD convention on corruption which precluded him from "taking into account considerations of the national economic interest or the potential effect upon relations with another state". He omitted the third element that should not have influenced him, "the identity of the natural or legal persons involved" – in this case the potential naming in a court of corrupt Saudi princes.

“Leave aside the effects on thousands of British jobs and billions worth of pounds for British industry. Leave that to one side, our relationship with Saudi Arabia is vitally important for our country in terms of counter terrorism, in terms of the broader Middle East, in terms of helping in respect of Israel/Palestine,” said Mr Blair. “That strategic interest comes first, particularly in circumstances where, if prosecutions have gone forward, all that would have happened is that we would have had months, potentially years, of ill feeling between us and a key partner and ally, and probably for no purpose… He continued: “I take full responsibility for the advice I gave in respect of it, but I have no doubt at all that had we allowed things to go forward, we would have done immense damage to the true interests of this country, leaving aside the fact that we would have lost thousands of highly-skilled jobs and very, very important business for British industry.”

There's more. According to the so-called Shawcross convention, the decision whether to halt a prosecution or criminal investigation rests solely with the attorney-general and not with any other members of the government, whom the attorney may, but is not obliged to, consult. Yet on the one hand the attorney-general says that the decision was taken not by him but by the head of the Serious Fraud Office, who has avowedly been under pressure of 'advice' from the prime minister, the foreign and defence secretaries and the attorney-general, all urging him to halt the investigation (pretty persuasive, one supposes), while the prime minister takes full responsibility for the 'advice' he has given. More still: the attorney-general tells the media that one of the factors influencing his 'advice' to the SFO was his judgement, which he asserts was shared by the SFO, that the evidence turned up by the SFO investigation was unlikely to support an eventual prosecution or prosecutions. But the head of the SFO has disputed this, saying that it's far too early in the investigation to form a view about the likelihood, or lack of it, that a prosecution would have a reasonable chance of success.

Meanwhile Mr Blair asks us to believe that if the SFO continues to investigate these deals with the Saudis, they will withdraw their cooperation with us "in terms of the broader Middle East, in terms of helping in respect of Israel/Palestine." But any schoolchild must know that Saudi middle east policy is determined by the Saudis' own judgement of their country's (or its régime's) interests, not by pique over the behaviour of the prosecuting authorities of a middle-ranking country far away in Europe and, in truth, one with precious little influence on events in the middle east, whatever Mr Blair's messianic delusions might lead him to believe to the contrary.

As for national security, Richard Norton-Taylor has it shamingly right in the Comment is Free Guardian blog:

So now we have it: Britain's national security is in hock to a corrupt and despotic monarchy, which our own Foreign Office admits is a serial abuser of human rights.

We may ask in vain for practical details of the ways in which Britain's national security would be damaged by any partial and temporary interruption of cooperation on terrorism matters with the Saudis: what kind of intelligence, for example, it is that they provide to us at present but that we couldn't get from any of our other and more reliable intelligence partners? Is it really so indispensable as to outweigh our obligations under the OECD Convention and our international reputation as an enemy of corruption? So valuable that for years to come we shan't be able to insist on developing countries eliminating domestic corruption as a condition of receiving our development aid, without them laughing in our faces? We shall never know: all these matters are masked and hooded in secrecy.

There could be a different response to Saudi demands that we stop investigating them, "or else". How cheering it would be if the British ambassador to Saudi Arabia were to be instructed to call on the senior Saudi prince and say to him:

"Your Royal Highness, I'm sorry to disappoint you, but I'm afraid that in our country we don't practise political interference in semi-judicial proceedings such as the investigation of possible crimes committed against our laws. I ought to remind you, politely, I hope, that your country has more at stake in preserving a constructive relationship with my country than my country has in its relations with yours. Britain plays a significant role in supporting and sustaining Your Royal Highness's avowedly unstable and insecure régime, whereas ours doesn't depend in the smallest degree on support from yours. The danger to the Saudi throne posed by Islamic extremist terrorism far exceeds any danger it might pose to our much more durable democracy, and if you carry out your threat to withdraw cooperation with us in our joint campaign against terrorism, you will lose more than we shall: cooperation is a two-way street and we have many other more substantive partners in this effort than you do.

"I also hear what you say about the consequences for our hopes of selling you 72 Eurofighter Typhoon jets if we go ahead with our investigation of possible illegal bribes paid in the context of the earlier phases of Al Yamamah, but I respectfully remind you that here too your country and government have a significant stake in preserving our goodwill. We have in our possession a huge stock of information about the ways in which the Saudi royal family benefits financially and personally from these huge contracts, ultimately at the expense of ordinary Saudi citizens, and you can easily imagine the effect on the stability of your régime if even a fraction of this information were to become public.

"Moreover, I think you should consider the likely consequences for your defences, both domestic and international, if there were to be a regrettable interruption in the supply of spare parts, servicing, training facilities and other after-sales services in support of the enormous amount of defence equipment that we have sold you since 1985. Perhaps you would be able to replace these by persuading new French commercial partners to supply them, but I very much doubt it.

"I do hope that on sober reflection you will agree that we both have a major interest — yours even greater than ours — in avoiding an impulsively conceived breach in our mutually profitable relationship, and that it will be in Saudi Arabia's interests as much as (or more than) ours to concentrate now on eliminating any hint of sleaze or corruption from our future dealings, even if that means tracking down and prosecuting those in both our countries who may — or may not — have been responsible for corrupt activities in the past.

"And finally, Sir, I ought to tell you in all frankness and friendship that my country has never taken kindly to being threatened, and that we have a record of remarkable obstinacy in defending our democracy and its commitment to the rule of law, even if there is sometimes a material price to be paid for doing so. Our people have a quite strong antipathy to being pushed around, even by wealthy countries in whose friendship we have a major stake. It is an attitude that I earnestly and respectfully commend to Your Royal Highness.

"I should of course make it clear that I am speaking on the explicit instructions of my government."

Dream on!

Brian

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My reaction to this sorry episode was not one of surprise, as I've grown used to being let down by our leaders in recent years, but one of sadness and a fair degree of embarrassment. Less than six months ago the Government published a White Paper on international development which highlighted the importance of good governance nationally and internationally. And now the same Government has decided that it's fine for politicians to interfere in the judicial process. Imagine how embarrassing it must be for poor old Hilary Benn, who has been travelling the world calling for developing countries to improve the way they govern themselves.

Brian writes: Pete, I had exactly the same thought: sympathy for Hilary Benn, who I believe is also in charge of the group drafting a new and comprehensive anti-corruption Bill. The only hope now is that Gordon Brown, once given the chance, will clean out the stables. Brown-Benn would make a great ticket.